Schedule and Timing Issues Complicate Withholding Premiums for Medicare Parts C and D from Social Security Payments

GAO Report Conclusions and Recommendations: SSA and CMS have made considerable progress in working together to solve problems and reduce delays in processing premium withholding requests. However, significant challenges remain due to SSA’s limited window for processing requests, which is driven by Treasury’s schedule for accepting payment changes, and to the statutorily required dates for accepting changes to enrollment in Medicare Parts C and D plans. In considering possible changes to the dates of Medicare enrollment periods, many factors must be considered in addition to the impact on premium withholding. GAO is currently conducting a more comprehensive study of the various issues related to the AEP, with the resulting report scheduled for publication in the fall of 2008. To help premium withholding become a more viable payment option for Medicare Parts C and D, and to reduce the number of requests requiring retroactive adjustments, we recommend the following: • CMS should consider alternatives to the approach put forth in the proposed regulations for preventing double-billing of beneficiaries while premium withholding requests are being processed. More specifically, for initial premium withholding requests (either for new enrollees or for existing enrollees who want to switch to premium withholding), CMS should consider allowing plans to bill beneficiaries directly until they are notified that the request for premium withholding has been accepted and will begin to be reflected in the beneficiary’s next Social Security payment. For all requests that are not addressed by the previous recommendation, SSA—in consultation with CMS and Treasury, as appropriate—should explore other ways to expedite the processing of premium withholding requests, such as • separating batch transaction files for paper checks and Electronic Funds Transfer (EFT) payments, which may allow extending the processing window for changes to EFT payments, or • processing more cases during Treasury’s extended window for accepting changes to Social Security payments.